When Not to Trade

Personal Reasons Not to Trade

1. Avoid distractions

Keep your focus on the charts and avoid losing it because of things happening around you.
For example, you might be waiting for a trade setup, get distracted, and when you return to your chart, you’ve either missed the trade or made a mistake opening it.
Distractions can cost you money.

Life is full of them, so put the cat in the hallway and close the door.
Whatever your personal distractions may be, find a way to manage them before you start trading.

2. Emotional moments

If something emotional is happening in your life and you cannot maintain objectivity — don’t trade!
This could be anything that negatively impacts your day: road rage, a breakup, stress, conflict, etc.

When trading, you must be able to evaluate what is happening in a very short period of time.
If your mind is elsewhere, it will negatively impact your account.

Emotional disturbances are clear signs that you should not trade.

Personal situations to avoid trading can be summarized as moments when you are not in sync with your normal mental rhythm.

There are absolutely times when emotions or your environment can influence your trading negatively.
The good news is that these factors are usually within your control — with discipline and mental awareness.

Remember: your thoughts depend on your environment.
Protect your mental environment, because its impact on your trading results is crucial.

Market Reasons Not to Trade

These reasons are external and mostly out of your control.
They can hit you hard and keep you limping for a long time.
Ignore them at your own risk!

1. Bank Holidays

Bank holidays are scheduled and unavoidable.
Banks are the largest participants in the Forex market.
If they are closed, trading volume drops significantly.

This can cause either:

• extremely slow markets, or

• highly unusual price behavior.

Either way — stay out.

However, if the bank holiday is in a country like Japan or Australia, you can still trade currency pairs related to those countries (EUR/AUD, USD/JPY, etc.) but avoid the rest.

2. News

Economic news releases happen every day and can be seen in advance using an economic calendar.
The most popular one is Forex Factory.

News is marked by three colors:

• Yellow – low impact

• Orange – medium impact

• Red – high impact

Red folders (high impact news) often cause strong volatility, sharp spikes in both directions, and unpredictable moves.
Many traders avoid these periods completely.

Particularly dangerous are interest rate announcements, which can cause massive market movements.

It’s not only the announcement itself—sometimes rumors or expectations cause chaos even before the event.

These can be the biggest account killers.

3. Speeches

These are also listed on economic calendars.

If certain people speak — DO NOT trade.

These include:

• ECB President Mario Draghi

• FED Chairman Jerome Powell

• BOE Governor Mark Carney

• BOJ Governor Haruhiko Kuroda

These individuals often hint at upcoming economic policy changes.
Hints alone can trigger huge market speculation and dramatic price movements.

As mentioned earlier, interest rate expectations cause big volatility.

4. Irregular price behavior

Sometimes a currency behaves abnormally.
Maybe price is rising or falling and you don’t know why.

This is a clear sign to stay out.

If you cannot understand why the price is moving a certain way, it is often due to unplanned news or some unexpected event.

This is bad news — because the market is uncertain about how to react.

For example, this happened frequently during the Covid-19 pandemic.